International Mediation – The New Libel Tourism?

Guest Blog: U.S. celebs, increasingly drawn to the UK courts by its tougher libel laws, will find a new emphasis on mediation to settle media disputes

Many American stars, such as Britney Spears, Jennifer Lopez, Kate Hudson, Angelina Jolie, Cameron Diaz and Teri Hatcher, have utilized the UK courts to protect their reputations by taking advantage of Britain’s libel laws, which are more stringent than the First Amendment protection offered to American publishers.

The apparent similarity in the laws on either side of the Atlantic, and of course the fact that the U.S. legal system was originally founded on British common law principles, may make it surprising that Americans have felt the need to cross the Atlantic Ocean to avail themselves of a level of reputational protection that is taken for granted in most European countries.

When President Obama signed the SPEECH Act into law in fall 2010, it was a significant event for international mediation for the U.S. The genesis of the law can be credited to Dr. Rachel Ehrenfeld who, rather than defend a libel action brought against her by Sheikh bin Mahfouz in London, decided instead to take steps to prevent the enforcement of the damages award made against her by the High Court in London.

Although initially unsuccessful in the New York State and Federal Courts, she ultimately achieved the protection she was seeking with the passing of New York’s Libel Terrorism

Bill. The statute served as a precursor to similar legislation subsequently introduced in other states and Congress.

The fact that there have been few, if any, attempts to enforce UK libel judgments in the U.S. over the years raises questions about the legislation's necessity. However, although it may now be difficult for an American national to sue a U.S. publisher in the British Courts, this legislation will not have any impact on their ongoing right to sue European publications who have published false and defamatory allegations. Accordingly, libel tourism remains alive and well … it’s just that the United States may now be off the list of favored destinations.

The costs involved in what is often acrimonious libel litigation, in both financial and personal terms, has been the focus of governmental scrutiny in recent times. The past 12 months in particular have seen a number of positive indications from the UK and Irish governments that mediation should be encouraged as an alternative to expensive litigation. Such encouragement also comes on the back of judicial decisions in which mediation has not only been endorsed, but in which a party’s refusal to mediate has been faced with punishment, perhaps where it hits clients most, by way of a costs order.

A number of high-profile cases have made the views of the judiciary crystal clear, along with the draft Irish Mediation Bill, and with an indication given that lawyers owe a duty of care to their clients to advise them of the option of mediation and to caution them on the likely consequences if they refuse.

The high profile of American celebrities, and the interest their claims have attracted, created a major panic in Britain and America, with the press fearing not just a run of potentially large damages awards, but also that the publicity surrounding these claims could also encourage other lesser known individuals to follow suit.

U.S. nationals have taken advantage of the UK’s more favorable libel laws for many decades, dating back to Liberace’s famous case against the Daily Mirror on the basis of an article implying that he was a homosexual at a time when homosexuality was illegal.

However, in recent times, there has been a marked increase in the number of these claims for two very specific reasons.

Firstly, the rapid expansion of the Internet has resulted in the extended publication internationally of established U.S. newspapers and periodicals, many of which can and are readily downloaded from within the UK and other European jurisdictions. Indeed, with more and more U.S. sitcoms being broadcast on international networks, it is no longer just movie and music stars who are household names, but also B-list celebrities who can establish that they have an acknowledged reputation in the eyes of the British public.

Another aspect, and the motivating factor behind this type of litigation, is the increasing importance of brand protection, with the credibility of the names of international personalities – their brands – being just as important to their commercial interests as to their professional achievements and personal reputation. Accordingly, a derogatory comment here or the reporting of an unsavory incident there, can have extremely serious financial repercussions for the individual concerned. The international personality is often left with no alternative but to seek vindication in the UK Courts in order to placate the moral and other requirements of commercial sponsors.

The second reason for the apparent increase in international libel litigation in the UK Courts is the prohibitive nature of the challenging hurdles facing an individual wishing to bring an action in the United States.

Not only do the First Amendment and other protections leave an individual with the difficult burden of having to prove actual and specific malice on the part of the publisher, but the introduction by states such as California of SLAPP Motions, with the various costs risks involved, is discouraging to all but the most resolute and determined of litigants.

However, with increasing pressure from the British Government and Judiciary for a reduction in escalating legal costs, it will be interesting to see whether these increasing calls for mediation as an alternative to litigation will be adhered to, particularly following on from the recent European Directive, which is intended to encourage alternative dispute resolution (ADR) across the board in all European states.

Perhaps surprisingly, it has until recently been the Defendant publishers who have shown the most reluctance to engage in what is still regarded as very much a new and untested option of ADR. The landscape is changing rapidly, primarily due to the dramatic revelations coming out of the Leveson Inquiry on a daily basis and the introduction of an experienced mediator to determine the level of damages in the less controversial of the phone hacking cases. Perhaps this new direction in strategy on the part of News Corp. will encourage others to follow suit with regard to other forms of media litigation.

Accordingly, we may yet see London, Dublin and Belfast becoming the go-to places for their mediation facilities for Americans seeking justice on European shores.

Paul Tweed is a mediator and arbitrator with JAMS International who focuses on media law in England and Ireland. He can be reached at +44 (207) 583-9808 or sclarke@jamsinternational.com. Bloomsbury published Paul Tweed’s book entitled “Privacy and Libel Law: The Clash with Press Freedom.”

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Paul Tweed is a mediator and arbitrator with JAMS International who focuses on media law in England and Ireland. He can be reached at +44 (207) 583-9808 or sclarke@jamsinternational.com. Bloomsbury published Paul Tweed’s book entitled “Privacy and Libel Law: The Clash with Press Freedom.”